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Brexit: Theresa May faces questions after claiming ferry due diligence done by consultancy firm - despite officials already admitting it 'could not complete tests'

Follows mounting pressure on Chris Grayling to resign over the cancelled £13.8m contract with Seaborne Freight

Ashley Cowburn
Political Correspondent
Wednesday 13 February 2019 15:41 GMT
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Jeremy Corbyn hits out at Theresa May over post-Brexit shipping contracts at PMQs

Theresa May is facing fresh questions over the Seaborne ferry fiasco after claiming consultants Deloitte undertook "due diligence" on the company - despite the auditor having already revealed they were unable to complete necessary tests.

It comes amid mounting pressure on the transport secretary Chris Grayling to resign over the cancelled £13.8m contract with Seaborne Freight to provide ferry services in the event of disorderly Brexit.

Ms May made her remarks in the Commons as she came under heavy fire from Jeremy Corbyn at prime minister's questions, as he asked: "What went wrong?"

The prime minister claimed during the exchange with the Labour leader that all proper processes had been carried out, but a report from the independent National Audit Office (NAO) clearly states that Deloitte were unable to do "standard tests" because Seaborne lacked relevant records.

At the weekend the firm's contract was cancelled by Mr Grayling after the transport secretary faced ridiculed when it emerged Seaborne had no ferries and appeared to have copied terms and companies on its website from a takeaway restaurant.

Speaking in the Commons, Ms May said: "Due diligence was carried out on all of these contracts and as Mr Grayling made clear earlier this week, we will continue to ensure we provide that capacity, which is important in a no-deal scenario."

The prime minister also added: "When these contracts were all let, proper due diligence was carried out - that included third-party assessment of the companies that were bidding for the contracts.

She said the Department for Transport's £800,000 assessments were carried out by DfT officials and third-party organisations, including Deloitte, Slaughter & May and Mott MacDonald.

But according to the independent National Audit Office (NAO), Deloitte could not complete the "standard tests" on Seaborne "given the lack of existing financial information".

"Deloitte therefore did not make a formal assessment of Seaborne financial stability," the auditors added.

The firm Slaughter & May's included a "basic background check" while Mott MacDonald's review flagged "significant execution risks" relating to the ferry contract with Seaborne.

In his remarks at prime minister's questions, Mr Corbyn said the "spectacular failure" of the contract was a "symbol of the utter shambles of this government and it's no-deal preparations".

He said the fiasco surrounding the Seaborne Freight contract summed up the government's "costly, shambolic and deliberately evasive" Brexit strategy.

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